The crypto community considers exchanges and altcoins linked to Justin Sun to be unsafe due to some unusual activity. Sun has now transferred $100 million to the Bitcoin exchange to boost trust.
Investors are worried about the future of the Bitcoin exchange linked to Justin Sun
The Tron founder moved his $100 million stablecoin to Huobi after the exchange announced it was laying off employees. According to data provided by Nansen, the funds were transferred from Binance to Huobi, in which Sun has a controlling stake. Transactions took place on USD Coin (USDC) and Tether (USDT). Sun later stated that he sent “personal funds” because doing so “shows confidence in the Huobi exchange.” Nansen analyst Martin Lee commented that the transfer “could be to assist with increased withdrawals or to maintain a level of confidence in the stock market.”
According to on-chain tracker WhaleAlert, Justin Sun previously transferred nearly $50 million worth of USDT to Binance. The tracker also revealed that USDC and USDT tokens, worth a total of $100 million, were also transferred from an anonymous wallet to Huobi.
Singapore-based Huobi is the fourth largest crypto exchange by 24-hour trading volume, with $371 million in trading volume in the last 24 hours. But recently, customers have been panicking, and Reuters reported that it previously laid off 20% of its employees.
Bitcoin exchange suffers record fund loss, Justin Sun reassures
Last week, independent crypto journalist Colin Wu reported that the exchange is paying staff salaries in stablecoins, and employees are reacting to it. According to Nansen, Huobi saw $94.2 million in net outflows last week, with $60.9 million in withdrawals in the last 24 hours. Meanwhile, Sun and his team claim that the market is surrounded by FUD. Talking about recent events, Sun gives the following statements on Twitter:
At Huobi, our strategy is “Ignore FUD and Keep Building”. By staying true to our mission, investing in technology and security, listening to our users, we are able to provide our users with a reliable and reliable platform to buy, sell and exchange cryptocurrency.
USDD dollar lost its stability
In the above environment, the crypto community has been speculating about a possible recurrence of the stablecoin crisis that occurred with Terra-UST seven months ago. Given some unusual activity around the Huobi Chinese crypto exchange, people think it is not safe to hold USDD.
Speculation about the collapse of the USDD algorithmic stablecoin was that the project was built by Justin Sun, who is also the chief advisor to the Huobi exchange. Nansen tracked Huobi’s trading volume in the past 24 hours, revealing that users had withdrawn over $60.9 million. The figure represents more than 64% of the total $94 million outflow in the previous seven days. As Kriptokoin.com, we have included the details of the transactions in this article.
According to Nansen, the most withdrawn coins from users with large wallet balances were USDT and USDC. Meanwhile, USDD price is trading below $1.00. After the FTX bankruptcy in November, it lost its stability and failed to recover. Lookonchain previously implied that the collateral ratio of the USDD stablecoin reserve is only 50%, claiming that 99% of the TRX tokens in the USDD reserve are unavailable.